Coming up on the Leadership Growth Podcast.- Nature is moving all the time, you just can't see it. It's changing constantly and companies are prone to wanting to optimize what they do. They find a business model, they narrow it down. It's like finding a pond in a desert. You find all these animals gravitating toward that resource. That's what a company does. They gravitate, their business model gravitates to that pond and they exploit it as much as possible until it's all gone and then they go, then they die. If they were really smart, they would evolve themselves all with using that pond's resources to change who they are constantly so they can find other ponds further away and further away and further away.(upbeat music)- Hey everyone, welcome to another episode of Leadership Growth Podcast. I'm Daniel Stewart, joined by my brother, Peter Stewart and today we are honored. Honored to have a fantastic guest, Ron Amodeo, and I'll formally read his full bio in a moment but Ron, welcome to the Leadership Growth Podcast.- Thanks, glad to be here.- So just so that all listeners know who Ron is, let me share a little bit about his background, especially 'cause this introduces well the topic that we're gonna be diving into today. Ron Amodeo serves as Chief Strategy Officer for UC Davis Health. He oversees strategic planning, business development and execution, enterprise project management, performance improvement, market analytics, strategy intelligence, community integration, health ventures and payer contracting. Before joining UC Davis Health in 2020, he was an expert advisor with Dorsey Health Strategies, Chief Innovation and Growth Officer at Regional Health, now Monument Health in Rapid City, South Dakota and Director of Business Development at Mayo Clinic in Rochester, Minnesota. Mr. Amodeo holds a Master's in Information Design from Carnegie Mellon University and a Bachelor's in Biology and English from Allegheny College with doctoral studies in history of science and technology from the University of Minnesota. There you go, folks. Did you hear that fantastic level of experience? Because all of this then weaves together onto the topic that we have today. So again, Ron, welcome. This is exciting and let's dive in. The topic of nature and how nature relates as informed by strategy and vice versa. What is that relationship between nature and strategy and no doubt how leaders then show up, how we lead is gonna be influenced by some of this. So Ron, as we've talked about this topic before, give us a high level. As you hear this idea of nature and strategy, there's so much conversation around making good strategic choices. Give us a foundational viewpoint of how these two topics relate.- Yeah, happy to. Thanks for the question. So let me start with how this idea emerged. I had quite a background before I went to Mayo Clinic. I was involved in startups and a lot of consulting in retail and manufacturing. And at the same time I was working on my PhD at the University of Minnesota. So I would go back and forth between the business world and into the history of science world, particularly the history of biology and evolution. And I began to see some really deep parallels between the theories and facts that were in science and the strategies that were in business. In fact, if people could think back to in the day when the company Saturn existed, it was a car company that was going nowhere inside of General Motors for years. And then they had this brilliant idea to just pick the whole thing up and move it from Detroit to Tennessee. And wouldn't you know it, within two years they had a car on the market, became one of the best-selling cars in America. And I saw that model and I said, boy, that's exactly what the ornithologist and paleontologist Ernst Mayr from Harvard said, when you wanna start a new species, pick a flock of birds up, move them to an island really far off the coast, and they will more or less turn into a new species after a period of time. So that was the beginning of this. And what I've seen over time is that there are hundreds and hundreds of examples of nature and the theories of nature informing how we do strategy.- Ron, this is fantastic. I mean, there's about a hundred follow up questions already in my mind on this one, especially what you're introducing is the impact of the environment and also I'm just picturing people typically where strategy comes and the conversations are inevitably in some sort of stale conference room, I'm generalizing, but you know, let's have a four-hour meeting in a gray conference room and talk about this. And what you're introducing, Ron, is to at least conceptually step out of that conference room and really pay attention to what has already been going on for thousands plus millions of years. What can we learn from this to help inform us as we're making organizational strategic choices as well? And that's a powerful different perspective to introduce. Any further reaction as you're kind of hearing this as we're getting going, Ron?- Yeah, I think, so the post-industrial world business has been around for a couple hundred years, getting better and better. And we've seen strategy books come out in the last hundred years. And then Deming came out in the '70s and more and more books have come out which have made the writers famous for strategy. But if you think about it, nature's been doing their business for a billion years or more. And especially when with living organisms, they've had a lot of time to refine their business models. And companies and organisms approach the world in the same way, right? Both need to reproduce, both need food to survive. Food in a business world is money, right? It's some kind of transaction. Both need to grow and both will go extinct. For example, in the last 40 years, 50% of the Fortune 500 company is gone, right? Well, 99.9% of all species are gone. So extinction is a pretty common element in both worlds. So if parallels start there, where else could they be applied?- Oh, this is a fascinating notion, Ron, as we think about trying to apply so many of these principles that we are observing in the natural world around us into the business climate. Because fundamentally, nature is striving to survive. Fundamentally, business is striving to survive. And so how do we do that. So as we think about this, what are some of your favorite examples from nature and those analogous principles that we can apply into the business climate?- Yeah, I know that folks who are listening have seen innovation happen in companies in the last 40, 50 years. It's been a dominant theme for companies. And innovation happens in nature all the time. There's many theories of how it happens. A great example, the book written by Stephen Jay Gould, the Harvard paleontologist, called "Wonderful Life." And he wrote a story about a place called the Burgess Shale, which is in Yolo National Forest in British Columbia. And what was interesting was this discovery happened, I should say, the species they discovered happened before bilateral symmetry, which is the left and right side of your bodies are exactly mirror images of each other. Before this was a standard approach in life, right? It's pretty much everywhere now. But some kind of massive mudslide happened and it covered all these organisms, he wrote in his book, and he showed the fossils, and they were incredibly diverse, right? Things with seven arms, 15 arms, right? Life was trying to figure itself out. Well, this happens in companies all the time. When you do innovation, you put a team together, and the term people use is fail fast, right? Well, this was a great example of nature failing fast because within 20 million years, a short time in nature, they had discovered hard exoskeletons and had discovered bilateral symmetry and had discovered eyesight and things like that. And those things just now repeat through millions of years down to the present day. So companies, as they try to do innovation, find themselves reinventing this model of failing fast. Every time you go to a new company, they're like, "Well, we're starting an innovation group." They don't learn from nature. They could simply just model what nature has done around experimentation and get through many different opportunities very quickly.- Okay, Ron, let's take this to the next level here because this notion of modeling after nature. All right, if there was a client that came to all three of us, okay? Say we just started an innovation consulting firm. They came to us and said,"Hey, we need to be innovative about a new product," or we needed that something. What would we suggest based on nature? What steps what approaches,'cause what I'm hearing from you is it's this balance between the familiar that oftentimes we will gravitate to, and yet we need to introduce some novelty and it's balancing this. What are the steps from nature then that we can draw from to help us with a helpful innovation approach?- Yeah, well, the funny thing is, innovation's happening all around us, not just in nature. And I'll give you some examples. But if you look at a species that has a territory, right? Pick a certain kind of Kaibab deer down in the Grand Canyon, for example, right? Or the polar bear, it has a territory, right? In the middle of that territory, where there's the fewest amount of constraints, the bear will not change very much. But if you go to the boundaries of their territory, where there's a lot of constraints, and you see this with fish and you see this with plants, there's stress on those species. And that's where you see a lot of mortality and a lot of evolution is happening. And so the innovation is happening at the boundaries. And if you look at two countries where their borders meet, that's where the pigeon languages are emerging, right? It's not happening in the middle of the country. If you look at a market, two markets that are coming together, you see all the innovation happening there. Two eras, like you think about the eras between music, Baroque music and classical music. All of this change happened in a few decades when they clashed together, right? So if you wanna do it in a company, if we're a consulting firm, you would probably go to that company's boundaries and say, "Well, what products do you have that are doing something new in a different market or testing a new idea and/or design differently?" And you would spend all your time at the edge of that company, not inside, not in the middle of it.- This is a helpful framework to think about. And I love that thought of the innovations happen on the boundaries. They happen on the edge, away from the core. And I think so often in organizations, especially as we're building out a strategy, we're looking at a forecast. It's this notion of how do we preserve the core, the essence of what we've been doing. This has been our identity for so long, but yet that core can get stale. How do we infuse it with some new? And it's those edge cases. It's the new acquisition. It's the new product, that new innovation that we might not really be clear how it fits. It's like how far away from our fundamental core is this new opportunity? Is this? So how do we fight, I guess, embrace that a little bit more, that fear of are we going to get off balance? Are we losing our identity when there is this concept of a new idea, new product, service?- And ultimately that is the point. You do lose your identity because if you don't, you won't keep evolving. And there's a theory in biology called the Red Queen Hypothesis. And it basically says that if you don't keep evolving, and it's from Lewis Carroll's "Alice in Wonderland," where she says to Alice, where Alice says, "We're running, but we're not going anywhere." And the queen says, "Well, that's interesting. Normally you have to run twice as fast to get somewhere." And it's true in nature as well. Nature is moving all the time. You just can't see it. It's changing constantly. And companies are prone to wanting to optimize what they do. They find a business model, they narrow it down. It's like finding a pond in a desert. You find all these animals gravitating toward that resource. That's what a company does. They gravitate, their business model gravitates to that pond and they exploit it as much as possible until it's all gone. And then they go, then they die, right? If they were really smart, they would evolve themselves, all with using that pond's resources to change who they are constantly so they can find other ponds further away and further away and further away. So there's another, it's not just strategies in business, by the way, there are laws in nature that you can apply. There's one called the square cubed law. I don't know if you've heard of this.- Say that again, Ron, the square cubed law?- Yeah, the square cubed law. So the proportionally a mouse has a surface area that's fairly equal to its volume. But as you grow that mouse into something like a deer or an elephant, the surface area squares, but the volume inside of that animal cubes. So what happens is you have much less surface area than you have, and so what companies do, they do something similar. As they grow, the people who talk to people inside the company become bigger than the number of people who talk to the world outside. And so you get fewer and fewer ideas coming in to the company. And as a leader, of course, you would want to recognize this flaw in your company that you're only listening to each other and not listening to what the world is doing.- And that begins to get at some of these constraints that you've been mentioning. You're capturing so many different dualities or polarities that inevitably exist in nature, that nature has found ways to manage or to address in various ways. And yet as humans, at least what I find is, leaders aren't always comfortable with dualities. They prefer viewing complex challenges as kind of on or off, right or wrong. It was kind of, here's the answer. And that's very satisfying for investors, for leadership teams, that this is the one approach. And yet, as you're describing Ron, at the edges where the constraints are most visible and that you can feel them the strongest, that's actually where some of the greatest innovation and change can happen, but it's an uncomfortable place to be. It forces us out of this notion that there's a right answer. It also introduces time challenges. Just like what you've described, 20 million years in nature, they don't have Wall Street to contend with. They don't have quarterly calls and such. What are ways to be able to help a leader who wants to be innovative and yet needs to deal with this time pressure of what we've put on ourselves, the 90 day plans, the monthly, the annual kinds of things. What's a way to be able to manage that duality of we need to do something quick and on time while still respecting this kind of natural progression that also needs to happen. I'm combining a lot of things here, Ron, but as you're kind of hearing this, what are your some reactions here?- Yeah, I think that's a deep question, but the challenge for leaders is to find ways to innovate while they're doing their day job. And one of the big issues for them is where are the resources coming from, especially as you get these 90 day plans or your KPIs that you need to meet every year. It's a challenge in that it's counterintuitive what you actually have to do. So I will again go back to biology. There's a concept that's been proven for the last 80 years called fitness landscapes. And it was produced in the 1930s. And it basically said, and I'll just get to the end of the story, those species that optimize like a company to their highest extent, meaning they're at the top of the mountain in regards to optimization. Think of a manufacturing company like Ford, right? Making automobiles day after day after day after day. Those are at the top, they do the best, but they're the most prone to changes in the environment. And they're the ones, as we saw in the 70s, when all those folks got fired from auto companies, when things changed, when the Japanese brought in their low price cars, they weren't prepared for those changes. So biology would tell you the species that lasts the longest like the horseshoe crab, it's been around for a billion years. That's a good business model, right? It doesn't optimize. It gets to about 80, 75% of its optimization. And then it conserves its resources to change. And so innovation comes from conservation. You move resources from where you might continue to optimize into areas where you can experiment. And if you can get the organization around you to think that way, then you will continue forward evolving and being more competitive and cooperative with the world.- So let's pull on this idea of optimization a little bit. And I wanna go back to the original analogy you were sharing or example of Saturn car company. And I think the tagline went, a different kind of car company back in the early nineties, whenever that was. And they found success by transporting that factory from Detroit to Tennessee. And it made me think about the power of context and the environment around in which we operate. And we're just talking about optimization with the horseshoe crab example. And as we kind of pull back in and think about context, what are the signals? What are the signs? How do you know when the context you're trying to operate in is not advantageous to what you're trying to optimize or build out?- Normally it's when the internal structures are your biggest constraints. There's too many committees. There's not enough funding. The only people you can bring on board are people who don't have enough time to work on the project and it's not the passion of the leadership team. So it's more of a one-off or it's a personal commitment for somebody. So, I mean, if you reverse it, you think about how successful Saturn is. General Motors was so impressed by Saturn, they said, "Well, we can improve it." And they brought it back to Detroit. And in three years it was dead as a company. And so, yeah, I think internal constraints are the principal reason that you'd want to spin something out into a new environment. Because we really don't tend to trust the process because it means all the oversight that you think is so important is not gonna be applicable there. But that's exactly what you don't want is the oversight.- What about if we take this idea of innovation and apply it on a day-to-day basis?'Cause some of what we've been talking about are broader business models and have broader kind of timeframes. What have we learned from science, from nature, to help us on a daily basis? What sort of habits, what's a mindset, what are things that we might be able to do each day to adapt and adjust, challenging our own perception perhaps to foster a more open, change-oriented while still being strategic? It's balancing that, but on a day-to-day basis, Ron, what would you say?- All of us, there's this line in "Harry Potter" where Dumbledore says, "We all get sorted too early." I think many of us grow up thinking I'm this kind of person or that kind of person, and you end up in operations or you end up in business development or you end up in sales, and you think, "Well, that's who I am," right? And you sell yourself that way because let's face it, we all need food, we all need to make money, we're just like any other species out there. But everybody's innovative because we're part of nature, right? So if you give me the most ordinary operational person at the highest part of their game and you put them in a new environment, they will be innovating from the very first day they're there, right? So take somebody from Chicago and put them in Fiji, and they will innovate. So ordinary innovation can happen to ordinary people by changing their location. It can also happen, of course, in their regular day, simply by them setting up constraints for themselves, saying, "I need to think differently about things, right? I need to create conversations that are different. I need to create structures that push us, push our boundaries to new places." But we're all so comfortable that we hesitate to do that and upset the status quo. So it's a real challenge for us to hold true to that red queen theory where you have to keep moving, you have to keep moving.- Those little points you just were sharing there, of how do you think differently? How do you create those conversations? How do you adjust the structure to push a little bit more? Those are all, I think, very practical tips as we think about applying these to our various situations and pushing ourselves. Because ultimately what it sounds like we're getting at is the innovation, the adaptation does not occur just on its own. There are some intentional drivers to force that because we also have principles within nature of homeostasis and resource conservation, which in some way act against that drive to change and innovate because of a scarcity or a fear of that. And so I think there we set ourselves up for this classic just age, timeless battle of, well, do we expend resources to adapt and evolve and change or do we conserve resources because we're afraid they might not be around in the future?- Even this podcast in a way has to keep innovating. It has competition out there for an audience. It's trying to adapt to the circumstances that it's under and come up with new ways to think about itself. You may end up cooperating with somebody and coming up with a new idea instead of competing as well, right? But the challenge is not just for businesses, obviously for individuals to figure out a way. And nature to me is the easiest example of figuring out, look at, I'm jumping around here, but there are things called scaffolding species that are out there that if you don't have them, you can't build a larger ecosystem. A good example is the iPhone, right? Back in 2007, there was no iPhone. The iPhone comes out and all of a sudden 400,000 businesses exist creating, I mean, that's just the beginning. That was like the first year. Now we're in millions of businesses that create apps that go on the iPhone. So it became a scaffolding species. We can create those things too. We're a part of that environment and we build on each other as individuals.- What you're also getting at, Ron, which I really appreciate is the importance and emphasis on the outside structures and systems and environment.'Cause at least what I keep seeing is, especially in business focused organizations, we can put the onus on the individual leader so much. And we look and say, you're in charge, you should have the skills, you control things, you make the difference, which to a certain degree is true. However, we can overstate it so much because there is a dramatic influence and impact from the environment in which we work. What are the systems? What's the culture? What's the environment? What are other approaches? And frankly, what are the constraints that we can appreciate and value because they challenge us and they make us think differently instead of removing constraints and saying, ah, this is a better situation. And maybe for a time, however, that's not going to really prompt change or new ways of thinking very much, which often is needed. And frankly, in our marketplace is needed even more because it is just becoming even more of a necessity. So I appreciate the introduction and the emphasis around the environment for us'cause we don't often appreciate that. You've shared multiple examples of whether it's Saturn or you take an operator or any of, you want to get a different way of thinking, put somebody in a different situation, even for a short time and challenge and have that discomfort and let something different emerge and appreciate what that comes'cause they might come out with ideas that we need to have seven arms, just like that initial example you provided. And that may not last long. However, that idea that may prompt something else and something else and to appreciate that journey in the new situation and constraints are helpful. Other comments as you're hearing this, Ron, please.- I think one of the challenges for leaders is to not be so hard on themselves. They all wanna take it from A to Z and give themselves credit for I did this. But if you think about the cottonwood tree in the spring in Minnesota, every place is covered with their seeds, white seeds everywhere. All that tree is doing is laying seeds down, right? And it's very, very, very successful at it. I think as leaders simply find ways to spread your idea is incredibly important. And you don't have to take the idea to completion because it may lead to another idea, which may lead to another idea, which before you know it has changed the direction of the company and it helps them survive for another 40 years, right? So find ways to look at nature and say, I can do that too.- Yeah, that's fantastic. That idea, yeah, I love this concept because it reinforces, I think, a theme that often will come up in our podcast episodes. It's looking for those principles all around us of leadership, the lessons to be learned, but it takes a mindset on us to be open, saying, hey, what can I learn from a cottonwood tree? Like you just pointed out. What can I learn from this situation? What can I learn as I'm looking at, I'm in this forest and I see this tree and there's a mushroom, what can I learn from that? Or whatever it might be. There are lessons everywhere if we have the lens, the patience, and we tune ourselves into being open to those things around us. And that's what I love fundamental to what you're sharing here.- The most famous example, of course, is birds, right? They're not dinosaurs, but dinosaurs evolved feathers, which eventually became birds, but it took millions and millions of years, but they did change. Dinosaurs are no longer around. The great-great-grandparents are gone, but the kids are still here. They're flying. And no one could have predicted that. So innovations don't have to be huge and awe-inspiring. Sometimes they're just small, like I need something to keep me warm. And before you know it, a new species emerges.- Yeah, yeah. You can't take advantage of it. I love it, Ron. Okay, last question as we wrap up here. So if somebody, if a leader wants to strengthen their ability to think strategically, what would you recommend, Ron? What is a principle, what's an approach that a leader can use from nature so that they can build and think more strategically as they go about their work of leading others? What would you say?- Well, for me, I grew up on a farm, so I was surrounded by nature, and I had deep interest and passion in all sorts of things that were on the farm. So I think as a leader, you need to turn to the things that you're familiar with and you're comfortable with and you grew up with, and look for the lessons there. Either you grew up in the inner city, or you grew up with a large family, or you were an ethnic family, or you grew up helping with a bakery or whatever it is. The tools are right there. They don't have to be from nature. They can be from all sorts of other areas, but they can be your guide to how to lead, I think.- That's fantastic. Thank you. Ron, thank you for being on Leadership Growth Podcast today.- Thank you, glad you could have me.- Great insights, Ron, thank you.- Absolutely, and so everyone, all of our listeners, thank you for joining the Leadership Growth Podcast. Please join us again in the future. Subscribe, like, and please comment. We'd love to hear your thoughts and look forward to a future episode. Take care, everyone, bye. If you liked this episode, please share it with a friend or colleague, or better yet, leave a review to help other listeners find our show. And remember to subscribe so you never miss an episode. 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